Morgan Stanley fined Again

Last Month came the news that Morgan Stanley DW Inc. (MSDW) was fined $2.9 Million for stock market violations including the following violation.

Executed thousands of short sales transactions without ensuring that the firm could deliver or arrange to borrow the securities by the settlement date; - Link

Sounds like Naked Shorting to me, doesn't it?

The announcement was listed in NASD's October 'NASD NTM DISCIPLINARY ACTIONS'(PDF Document) Report.

Interestingly enough, Morgan Stanley was fined again according to the November Report.

Morgan Stanley DW Inc. (CRD #7556, Purchase, New York) submitted a Letter of Acceptance, Waiver and Consent in which the firm was censured, fined $500,000 (to be paid jointly to NASD, the American Stock Exchange and the New York Stock Exchange) and required to revise its written supervisory procedures regarding short interest reporting. Without admitting or denying the findings, the firm consented to the described sanctions and to the entry of findings that it utilized “z indicators“ in its Security Master File for securities traded on multiple exchanges, but the firm’s short interest reports short positions omitted securities labeled with the “z indicator.“ The findings stated that the firm failed to report its short interest positions in preferred and affiliates’ securities. The findings also stated that the firm failed to reasonably and properly supervise its process for reporting short interest to NASD, in that it failed to detect inaccuracies associated with its short interest reports and failed to have an adequate system of follow up and review for compliance with self-regulatory organization rules with respect to short interest reporting. The findings also included that the firm’s supervisory system did not provide for supervision reasonably designed to achieve compliance with applicable securities laws, regulations and NASD rules concerning short interest reporting. (NASD Case #20050024147-01) - November Report (PDF Document)

Those are some pretty hefty fines for a market that is not supposed to have problems with shorting stocks.

NASD Fines Morgan Stanley Firms $2.9 Million for Widespread Violations of NASD Rules
- FFI 26 October 2006

Criminal Charges for Hedge Fund Over Naked Shorting

Don't tell me that naked shorting does not exist. Don't tell me that it is not a problem either.

When you review SEC action again brokerages, in most cases the firms agree to pay a fine but do not admit any guilt in any wrongdoing. In some cases the firms even lose their license to continue trading, in effect, removing their direct access to the stock market. This type of oversight has been criticized as a failure by the SEC to police brokerages.

However, one of the hedge funds was so brazen in it's naked shorting that even the SEC cannot ignore their illegal activity and appears ready to bring criminal charges against the firm.

Sandell Asset Management is the mystery hedge fund that securities regulators claim tried to cash in on Hurricane Katrina.

The Securities and Exchange Commission last week formally notified the New York-based fund, which has more than $4 billion under management, that it could face a civil fraud action, sources say.

The potential regulatory charges arise from some short sales Sandell made in shares of Hibernia just before it was acquired late last year by Capital One.

A spokesman for the hedge fund, which recently sent a letter to its investors alerting them to the possible action, declined to comment.

Last month TheStreet.com first reported that the SEC was investigating an unidentified hedge fund for supposedly making improper short sales just as Katrina was laying waste to the bank's hometown. Regulators believed the hedge fund sought to profit from Wall Street speculation that the storm devastation would force Capital One to cut the price of its planned acquisition of Hibernia -- as it later did. - The Street

So why is this case so different? For one, it is hard to short a stock when there is clear documentation that there were few shares available to short.

When the hedge fund tried to short shares of Hibernia, it likely had difficulty finding a broker from whom it could borrow shares. That's because so much of the stock had been taken out circulation in anticipation of the deal with Capital One closing as intended on Sept. 1.

In mergers, shareholders of the company being acquired must "tender" their shares to their broker in order to collect on the payout. When the shares are tendered, they generally can't be lent out by brokers to short-sellers who bet against stocks.

A trader with another hedge fund said it too had been thinking about shorting shares of Hibernia after Katrina hit. But it couldn't find a broker that had shares to lend out, so it passed on the trade.

Yet sources say Sandell went ahead and shorted Hibernia anyway. The fund allegedly told brokers at several big Wall Street firms that it was borrowing shares from another brokerage and the big Wall Street firms executed the trades. - The Street

This puts the SEC in a difficult position. If they press the case and prosecute, it will further fuel the claims by those who claim that naked shorting is a problem. Looking at the NASD's own monthly Disciplinary Action Reports, I would have to agree with them that it is a problem. If they don't nail this fund to the wall for naked shorting, then that will be further evidence that the SEC is ignoring the problem.

Keep in mind that most traders like you and I can't get away with shorting improperly if you can manage to short a stock at all. That is because we trade online and have to clearly identify our trades as a short sale. The online trading programs will not let you sell any stock you want without having it in your portfolio. However, brokerages are getting in trouble time and time again for failing to mark sells as 'short Sales'. So they are either modifying your trade before it is executed, because they don't have the shares to loan, but do not want to lose your trade, or it is their traders who are regularly abusing the ability to sell shares short.

Why is it that the brokers who execute short trades be required to have the shares they are borrowing 'in-hand'?

Previous:
Morgan Stanley fined $2.9 Million for Rogue Trading - 26 October 2006
Congress Should Investigate Short Selling Records - 9 June 2006
Are Brokers 'Screwing' Stockholders through Short Selling? - 6 April 2006


Sandell Under Shorting Scrutiny - The Street.com 1 Nov 06
Thomas Sandell's Execution Problem - The Street.com 3 Nov 06

'Failed To Deliver' Shares A Persistent Issue - Investors.com
Not All Shares Deliver - Investors.com
Overstock Short Interest Now 107% of Float on Deposit at DTCC – Overstock
Regulation SHO Threshold Security List - NASDAQ
Dividend Tax Breaks at Risk – Fool.com
A Review of Current Securities Issues - US Senate
Corporate Voting Charade (PDF Format, but an excellent read) Bloomberg Markets
Hedge Funds: Got Kleenex? - Forbes
The Stock Market is Patently Unfair - The Street
NASD Suspends Broker for 90 Days - NASD
NASD NTM Disciplinary Actions Report for October - NASD (PDF)
Monthly Disciplinary Actions 2006 - NASD

The Christmas Tree is up!

We went out and got the tree on Saturday and its now up and decorated. We had planned on getting a tree about 5' tall. As you can see, we ended up with a tree that goes clear to the ceiling.

We will be celebrating Christmas in New York, which was one reason for wanting to get a small tree. The smaller trees were just as expensive so we just got the one that looked the nicest.

Here are a couple of ornaments on the tree.

There is also a small bird nesting inside the tree.

Christmas Time is here. ENJOY!

-

Anniversary of Pearl Harbor Attack (And a Fitting example of the results of dialoging with your enemies who are not acting in Good Faith)

Today is the anniversary of the attack on Pearl Harbor, and the United States by the Empire of Japan.

We should all remember the attack as well as the events that lead up to it. The US was in negotiations with Japan over other actions that the Japanese were taking in Asia. The talks were nothing but a diversionary tactic as the plan had always been to attack US Forces in the Pacific, instead of a backup-plan in case the negotiations failed. In effect, they were negotiating in bad faith.

It is fitting to remember that now, with the Iraq report suggesting that the US should talk to Iran and Syria as part of creating a more stable Iraq. Part of the reason Iraq is unstable is because of Iranian actions. Just how is talking to them going to help the situation. The three years of negotiating with Iran over their nuclear program has gotten the EU3 nowhere and Iran that much closer to a nuclear bomb. And that is barely recent history. The suggestion is even more confusing when you take into account what Iran has been saying. Is anyone in Washington, DC even listening to Iran? They are not exactly projecting the type of atmosphere that is conducive to any useful talks. Of course it would be in Iran's benefit to talk with us. It would give them the opportunity to demand that the US make changes to permit their operatives a freer hand in Iraq while at the same time telling the US to go F-themselves whenever the nice, US negotiator inquires about their nuclear program.

Of course, the US could tell the Iranians that failure to play ball will result in bombs dropping from the sky or the targeting of Iranian leaders, or a blockade, or sanctions, but thats not going to happen, isn't it.

EagleSpeak has some photos of the attack.
The US Navy has a summary of the attack, and more photos.

Related Posts:
Pearl Harbor, December 7 1941 - 2005 (Includes Roosevelt's 'Infamy' Speech.)
Remembering the Manhattan Project and the end of WWII - august 2005

6 December - Finnish Independence Day

Today is the 89th Anniversary of the Independence of Finland.

For a comparison of the difference between US and Finnish celebrations, take a look over at Finland for Thought.

You can also find more on Finland's Declaration of Independence from Russia at Wikipedia.

Is Darfur SO BAD that President Bush is their only hope?

The Eurocrats and Democrat Elites have long criticized President Bush for being too much of a cowboy and a blunt straight-talker, which is not compatible with working through the 'Diplomatic' UN and those who walk its halls, needing to be stroked and made to feel important just to get them to act on anything. This 'friction' existed well-before the invasions of Afghanistan and Iraq.

Ambassador John Bolton is the latest casualty of the snubbing of the President's foreign policy both at home and abroad. So it is pretty damn odd that the Save Darfur Coalition has been running an ad campaign pleading for Americans to ask President Bush to act on Darfur. From the website's faqs:

Why is the Coalition calling upon President Bush to help make sure UN peacekeepers are sent immediately to Darfur? Shouldn’t that be the UN’s responsibility?

The recent television ads sponsored by the Save Darfur Coalition asking President Bush to take the lead in pushing for the deployment of a UN force in Darfur are not meant in any way to “bash” the President, but rather to urge him to follow through on the good work he and his Administration have already begun. We are both cognizant and appreciative of the fact that the President has done more for the people of Darfur than any other world leader. In fact, it is because of his leadership thus far that we direct our pleas to President Bush now. The hard truth is that the United Nations does not have a standing army it can choose to deploy, it must instead rely on its member states to do the hard work necessary to actually deploy a peacekeeping force once that force has been authorized. As the strongest of member states, we believe that the United States, under the President’s leadership, must lead the international effort to raise and deploy that UN peacekeeping force. While we are not calling for U.S. troops in Darfur, we are calling for the strong U.S. leadership necessary to ensure that a capable UN force is raised and sent to Darfur as soon as possible.

It is also worth noting that while these ads running in the U.S. call for stronger leadership from President Bush, similar ads being run internationally call upon various international leaders to provide strong leadership as well. Advocacy directed at President Bush is not the sum total of our advocacy efforts, but is in fact only the U.S. directed portion of a larger international advocacy campaign directed at the top echelon of world leaders. - SaveDarfur.org

From the Commercial:


From one of the print ads: (View pdf)

It is nice to see that people still put faith in the President. This is both a credit to the President as a leader as well as a clear damnation of the UN and the UN Human Rights Council, which theoretically should be the global Human Rights watchdog. Instead it spends it's time condemning Israel while ignoring else in the world including even those who Israel is fighting against, like Hezbollah. Even the UN Secretary General has complained about their blind eye when it comes to crimes against humanity.

Some groups contend the new UN Council might be even worse than the discredited Commission on Human Rights that it replaced.

They say the Council has become obsessed with the Israeli-Palestinian issue to the near exclusion of the vast majority of the world's human-rights violators.

Since the Council was inaugurated in June, it has held two special sessions dealing with the situation in the Gaza Strip and one special session on the Israeli-Hezbollah conflict in Lebanon in August.

Even UN Secretary-General Kofi Annan, who pushed strongly for the creation of the Council, says it should broaden its focus and look at as many situations as possible.

"Whether their meetings coincided with the Lebanese war, or not, they have tended to focus on the Palestinian issue, and of course, when you focus on the Palestinian-Israeli issue, without even discussing Darfur and other issues, some wonder what is this Council doing? Do they not have a sense of fair play? Why should they ignore other situations and focus on one area?"

Some countries have severely criticized the 47-member Council for condemning Israel four times, while not taking up human-rights violations in countries such as Myanmar, North Korea, and Sudan.

The President of the Council, Mexican Ambassador Luis Alfonso de Alba, rates the work of the Council as fair.

"I would not say good. I wish it could have been much better." - Voice of America

How bad is that when even the President of the Human Rights Council rates it's work as poor. (Would you call a self-rating of 'fair' as good?) Of course, the other main UN body, the UN Security Council, is not able to act because any relevant actions against Sudan will reliably be stopped by China, whose veto was basically bought in exchange for Sudanese oil. The Russians can also be expected to prevent any action using their we will not do anything that may lead down a path to war excuse, made popular in attempts to act against Iraq, Iran, North Korea, etc... (their obstructionist actions most likely bought as well.) Which brings us back to Darfur.

So what are the people suffering genocide to do? They can't go to the Europeans. They have a history of failing to act, combined with a failure to even be taken seriously. (Like during the EU3 negotiations with Iran.) They surely must be desperate to ask President Bush for help. When the US helps, it often results in lots of bombing and targeting of the subject country's leadership, with an 'accidental' embassy bombing thrown in for added effect. Yes, those fighting to save the people in Darfur must be very desperate. Take this from the coalition's print ad:

Auschwitz. Armenia. Rwanda. Bosnia. Now Darfur.

We have seen the haunting pictures, heard the cries of grieving mothers.

Mr. President, you can end it tomorrow when you speak to the United Nations and the world. You need only stand up and say that the United States and its allies will take decisive action now to protect lives in Darfur. That the United States, and the rest of the world, will move now to deploy the UN force they've already approved. In America the support for action crosses partisan lines. John McCain and Barack Obama, Bill Clinton and Bob Dole support taking action now.

Please, Mr. President. Beyond politics, beyond borders, beyond religion, there is the moral imperative to save lives. Mr. President, the world is waiting. The lives of two million people hang on your every word tomorrow.

Please don't let them down.

I wish it were that easy. If the US were to act, it would be acting mostly alone, other than a few other honorable countries that would participate. The UN would not be part of the process for change other than to quickly point any and all embarrassing aspects of the operations. Europe might provide peace keepers, but they would come with so many limiting caveats as to render them useless. Those against the President at home and abroad would then deride whatever 'coalition' the President did manage to put together. Then once American peace keepers start taking casualties there would be a huge uproar for US troops to pull out regardless of the mess that would be left behind. And finally, we can expect a reprise of 'No Blood for oil' and as a bonus, American action in Darfur would provide further evidence that the US is at war with islam as it is the muslims that are doing the killing in Darfur.

So why don't we all get comfortable with the fact that those in Darfur are screwed.

Sad, isn't it. Even sadder will the the usual finger-pointing after the fact as to why nothing was done and the standard 'we can never permit another Darfur' empty proclamation from world leaders.

Save Darfur.Org

Note: I am in favor of the UN in Sudan doing what it takes to stop the killing in Darfur and action to charge the leaders of the Sudanese Government with Crimes Against Humanity.

Update: 6 December 06
Here is a short summary of current US action by the President:

US – economic sanctions re Sudan - On October 13, the United States enacted the Darfur Peace and Accountability Act of 2006 (H.R. 3127) imposing economic sanctions against certain senior officials of the government of the Sudan responsible for genocide, war crimes, and crimes against humanity in the Darfur region. Upon signing the legislation, President Bush issued Executive Order 13412 blocking property and prohibiting transactions by United States persons with the government of the Sudan. The statute provides, among other things, that the President should take all necessary steps to deny the Government of Sudan access to oil revenues, including by prohibiting entry at United States ports to cargo ships or oil tankers engaged in business or trade activities in the oil sector of Sudan or involved in the shipment of goods for use by the armed forces of Sudan. The function of denial of entry has been assigned to the Secretary of Homeland Security. Persons subject to US jurisdiction should exercise caution so as to avoid inadvertent violations of this law. (10/13/06). - Holland & Knight

It is a start, but hard to do it alone. Why are not other countries doing something similar?

President Bush Should Nominate John Kerry as John Bolton's Replacement At the UN

Ambassador John Bolton is resigning his post as US Ambassador to the United Nations.

Unable to win Senate confirmation, U.N. Ambassador John Bolton will step down when his recess appointment expires soon, the White House said Monday.

Bolton's nomination has languished in the Senate Foreign Relations Committee for more than a year, blocked by Democrats and several Republicans. Sen. Lincoln Chafee, a moderate Republican who lost in the midterm elections Nov. 7 that swept Democrats to power in both houses of Congress, was adamantly opposed to Bolton. - BreitBart

I would like to suggest that President Bush nominate Senator John Kerry for the position. First, Kerry has been critical of Bolton. So lets see how Senator Kerry does at the post. Who knows maybe he does know how to work with the people at the UN. He also has all sorts of International Friends as he pointed out during his 2004 Presidential run. He also knows diplospeak, and won't be as blunt as Bolton has been.

Finally, the UN is fast proving itself irrelevant, so why not send the most irrelevant person there that we can find, since the Democrats in Congress will not let President Bush send anyone useful. Of course the President can just make another recess appointment over the Christmas holidays (Note the timing of the resignation and the lack or naming a replacement) or just leave the post empty for now.

Original post here.

Bush Accepts Bolton's U.N. Resignation - BreitBart
John Bolton's Replacement: John Kerry - FFI 10 December 2006

Maritime Monday 36

Welcome to this week's edition of Maritime Monday.

This Week's Photo:
Here is a photo of Norway's Statoil LNG carrier ARCTIC PRINCESS.






So just what does the inside of the containers look like?

(Keep in mind that LNG is not pressurized)

This week's Items:

EagleSpeak covers the temporary closure of the Bosporus Strait due to an accident by a Russian Flag vessel.

American Maritime Officers Union (AMO) announces an agreement with Teekay Shipping to provide officers qualified to serve on LNG Vessels. No mention of the flag the vessels will fly. Teekay currently has no US flag vessels, with currently operated vessels flagged Bahamas and Spain. (The announcement seems to imply that they will be foreign flagged, turning the officers into an export.)

Sailors, Mariners & Warriors League has news of Japan investigating the Captain of the Panama-Flag GIANT STEP for negligence resulting in the grounding and loss of the vessel with loss of life.

Marine Link has an example of the cargo flexibility of a "Superflex Heavy Multipurpose Container (MPC) vessel" with a photo and description of the cargo carried by the RICKMERS TOKYO.

ContractsProf Blog has the news of a marine salvage lawsuit being brought in the Staten Island ferry accident by a tug that came to the rescue.

The Torch notes the purchase of a marine pollution surveillance aircraft by Transport Canada. Transport Canada has coverage of the discovery of an oil slick on the aircraft's first flight.

Jennifer Marohasy has an explanation why Greenpeace no longer pesters Norwegian whalers.

Alaska Report provides a dizzying summary of the 'privatization' of fish in the Gulf of Alaska and how Alaska's Congressmen Don Young and Ted Stevens fit into the whole story.

Malta Independent has coverage of the grounding of the Cruise vessel LYUBOV ORLOVA in Antarctica which required the evacuation of the passengers.

Washington Technology has new concerns about the Transport Worker Identification Credential (TWIC) program. This time concerning the accuracy/error rates of the biometric technology selected. (Personal experience has taught that getting the best possible enrollment is key to avoiding future errors.)

The UN's International Labour Organisation, ILO, has the news that Russia's Duma has ratified the Seafarers' Identity Documents Convention that was revised in 2003. Eight other countries have ratified the convention: France, Jordan, Nigeria, Azerbaijan, Hungary, Lithuania, Moldova, Vanuatu. No word on whether any of the countries is actually issuing seafarer documents with biometric identification included.

BusinessWeek has the Truckers strike in Greece attempting to cutoff all traffic to the Port of Piraeus in response to a three-week long dock workers strike.

One Digital Life has a photo of the contents of a shipping container lost at sea washed up on the beaches of North Carolina. (No. Not rubber duckies this time.)

STARBOARD!!! has news of the US Coast Guard cutter KEY LARGO using biometric identification to identify illegal aliens interdicted at sea.

New Scientist Tech covers Japanese research into reducing the friction drag of vessels in an attempt to make them 'greener' and discovers that what works in the lab on a model might not work so well on a real ship.

Savannah Daily News has a story on "the ancient and honorable art of watching deep-water ships sail in and out of port."

The USS INTREPID Museum website will have live online camera coverage of the second attempt to move the historic WWII aircraft carrier to shipyard renovations.

Gowanus Lounge has the latest on Brooklyn's Red Hook graving dock and Ikea's plans to fill it in.

China Law Blog notes that the #1 hot growth company according to Business Week is Precious Shipping of Thailand. Precious Shipping's website here.

Shahida Tulaganova, a reporter at the BBC, explains how she obtained 20 fake and stolen EU passports and uses them twice to enter the UK, being told by the passport dealers that border controls are the most lax at UK seaports.

Norway's Statoil has this interactive animation of the LNG Process from the seabed to the LNG Tanker at their soon-to-open Snøhvit LNG Project:

Be patient. It takes time to load!
Haight's Maritime Items has:

Documents required for Western Hemisphere air travelers - The Department of Homeland Security and Department of State jointly issued rules regarding documents required for certain travelers departing from or arriving in the United States at air ports-of-entry from within the Western Hemisphere. Effective January 23, 2007, US citizens and nonimmigrant aliens who are citizens of Canada, Mexico, or Bermuda will be required to present a valid passport when entering or departing the United States via air, with limited exceptions. Of interest to the maritime community, a valid merchant mariner document (MMD) issued by the US Coast Guard may be utilized by a US merchant mariner in lieu of a passport for travel in conjunction with maritime business. Interestingly, a Transportation Worker Identification Credential (TWIC) card may not be utilized because the TWIC card (when eventually issued) will not prove citizenship and the TWIC card cannot be read by the technology currently utilized at air ports-of-entry. This places the US citizen who is not a merchant mariner but travels offshore via vessel, say to an oil rig or a ship outside the 3-mile limit, in an interesting position. If that person (such as a contractor or maritime lawyer) does not have his or her passport and returns via helicopter, there may be great difficulty at the arriving airport. 71 Fed. Reg. 68411 (November 24, 2006). - Dennis Bryant (See Maritime Spotlight homepage for more stories or to subscribe to the daily email.)

Fairplay Daily News has:

Study makes fatigue recommendations - Excessive working hours continues to be a problem for the shipping industry, a major research study has concluded, but there is no simple solution. The six-year study found that almost half the seafarers who took part were working 85 hours or more each week; that working hours had increased over the past 10 years despite regulations intended to combat fatigue; and that one in four admitted to having fallen asleep while on watch. However, a range of strategies will be needed to prevent or manage fatigue because of the different profiles of fatigue risk factors in different working groups.

Recommendations included looking again at how working hours are recorded because current methods are not effective; building fatigue awareness into established health and safety training courses; and developing a checklist-style auditing tool that would help to assess work characteristics known to be risk factors for fatigue and subjective experience of these factors. Brian Orrell, general secretary of officers’ union Nautilus UK called for “a radical and urgent response from the government”, while Mary Martyn, head of the Maritime & Coastguard Agency’s health and safety branch, commented that the agency agreed that a co-operative approach is needed, involving regulators, shipping companies and seafarers.

The study was co-sponsored by the MCA and the Health & Safety Executive, with support from Nautilus UK and the Seafarers’ International Research Centre, and was carried out by a team from the Centre for Occupational and Health Psychology at Cardiff University. Lloyd's Register - Fairplay Homepage

Submissions for future editions:

Please submit articles for inclusion in next week' edition using the following submit form at Blog Carnival. You are also welcome to email photos for inclusion in future editions as well as suggest area of coverage.

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Finnish Triple-Murderer Escapes from an 'Open Institution'

What exactly is an Open Institution?

Inmates participating in work or other activities and who are considered to suit in freer circumstances and are not likely to leave the institution without permission, are placed in open institutions. In open institutions inmates always use their own clothes. All open institutions are intoxicant-free institutions, in which an inmate is required to controlled commitment not to use intoxicants. - Finnish Prison Service

Here is a photo of facility that the triple murderer escaped from:

("The Hamina Work Colony is a minimum security penal facility". HS Photo)

As you can see, this 'prison' is dependant on the prisoners not walking away. This is why, as it says above, they only put low-risk inmates in there. Here is where is gets tricky as the Finns, with their European-style 'forgive the criminal' mentality decided that a triple murderer with a life sentence was a low-risk criminal.

Convicted triple murderer Juha Valjakkala, who currently goes under the name Nikita Joakim Fouganthine, escaped from the Hamina Work Colony run by the Finnish Prison Service in the south coast city of Hamina on Monday night.

Valjakkala was last seen at the minimum security penal facility at roll call Monday evening at about 10:00 PM. His absence was noticed at eight in the morning, on Tuesday, which means that the escapee could have a head start of up to ten hours. - HS

Now if it makes you feel any better, according to their rules, he did not exactly escape. He just left without permission:

Leaving an open institution is not considered as an escape. If a prisoner has left the institution without permission, he can be ordered as a disciplinary punishment a loss of served time at most 20 days. In 2005 18 (27 in 2004) prisoners left an open institution without permission. - Prison Service

He must have had a good reason to leave, because being in prison in Finland is almost like not being in prison at all.

You get the have private visits with the wife:

Prisoners have the right to receive visitors at certain times reserved for visits during weekends and for a special reason at other times as well. In prisons there are family meeting rooms were close family members may meet in home-like circumstances for a few hours without supervision. - PS

Your even allowed to go on vacation from prison:

A prisoner may be granted a permission of leave after he/she has served a half of the sentence or if there is an especially important reason. The permission is granted if it is likely that the prisoner complies with the permission conditions. To a prisoner guilty of aggravated drug or violent offence or a prisoner who has earlier violated the permission conditions grossly can permission of leave be granted only if the complying with of the conditions is considered almost certain. - PS

And the Government pays for it:

Travel costs on the permission of leave are paid from state funds if the permission has been granted due to a close relative’s serious illness. Also the travels during the first leave and always when it is 6 months since the last return are paid by the state. Then the cheapest way of travel must be used. A prisoner may not leave the Nordic countries. - PS

Did you catch that last part? You can even leave the country. I would think that these events would be family related. I can't see even the Finns letting prisoners out to that they can go to a rock concert or something. So if it is a family event, why not require the family to pay for their loved one to show up.

So, lets back back to this wandering ex-triple murderer. Here is a summary of his Wikipedia page:

Juha Veikko Valjakkala (born June 13, 1965) became a part of Finnish and Swedish crime history in 1988 when he was convicted of the murder of a family of three at a cemetery in the northern Swedish community of Åmsele.

The series of events that led to the murders began when the 22-year-old Valjakkala was released from a prison in Turku on May 1, 1988, after which he started wandering through Sweden and Finland with his 21-year-old girlfriend Marita Routalammi.

On July 3 they arrived in Åmsele. After nightfall Valjakkala stole a bicycle. He was pursued by Sten Nilsson and his 15-year-old son Fredrik. The chase ended at a cemetery where Sten and Fredrik Nilsson were both shot by Valjakkala with a shotgun. Later Sten's wife and Fredrik's mother, Ewa Nilsson, went looking for the two and was stabbed to death by Valjakkala outside the cemetery. Valjakkala and Routalammi were caught in Odense, Denmark just over a week later.

Valjakkala was given a life sentence on three counts of murder, while Routalammi got off with two years for complicity in assault and battery. Routalammi was released after serving half of her time, and Valjakkala was transferred to Finland to serve out the rest of his sentence.

In April 1994 Valjakkala fled the Riihimäki prison where he was being held. He took a teacher as a hostage, but he was apprehended nearby and the hostage escaped the situation unscathed. He has also tried to escape once in 1991. - Wiki

He also attempted to escape from a prison (with fences) in 2004. That totals three attempted escapes prior to this escape. That does not include his arrest in 2002, in Sweden, where he went while on furlough/vacation from prison. He went and failed to return. So lets call it four attempted escapes.

If he is caught, his punishment would only be an additional 20 days which means nothing since he is serving a life sentence. for those familiar, a life sentence in Finland is about 12 years. He has already served 18 years and was waiting for a Presidential pardon. It might be that he got tired waiting.

I am taking a beating for my harsh stance on punishment of crime at this site here that is discussing this escape. It keeps getting brought up that it is the US's harsh punishment of criminals that is the cause of the America's high crime rate, compared to Finland and Europe's in general. I call BS on that and here is a little to back that up:

SUPERIOR POLICING does little good without a commitment from the justice system to keep violent thugs off the streets. The United States has the longest prison sentences in the Western world. According to the Bureau of Justice Statistics and its counterparts in other countries, a convicted armed robber can expect to serve about four and a half years behind bars in the United States, a little over two years in Great Britain, a bit less in Germany, and less than 18 months in France. The United States imprisons nearly 700 out of 100,000 citizens as compared to about 125 in the U.K. and Canada, 100 in Germany, and about 60 in most of Scandinavia. Some of these countries may actually have fewer thugs than the United States, but those left unpunished do enormous damage.

While building and staffing prisons costs a great deal, letting criminals roam free costs even more. One violent criminal can do over a million dollars worth of damage in the space of a year. A single armed robbery costs society more than $50,000, and a hardened thug can commit a hundred such crimes in a year. The European elite still seems to regard Americans' desire to lock up violent criminals as an index of barbarism and America as a nation gripped by violence and infatuated with rough, frontier justice. With violence and theft exploding all over the developed world, however, one has to ask which type of society is barbaric--one that punishes criminals, or one that lets them prey on law-abiding citizens?

Not surprisingly, overwhelming evidence demonstrates that keeping criminals locked up reduces crime. British academic Donald E. Lewis's comprehensive 1986 examination of studies on the correlation between sentence length and crime rates (published in the British Journal of Criminology) concludes that doubling the length of the sentence for a crime will cut the likelihood that criminals will commit that crime by a little less than 50 percent. In a comprehensive comparison of crime rates in the United States and Great Britain, a Bureau of Justice Statistics researcher and the head of Cambridge University's Criminology Institute hit on the key fact: Crime rates fell in the United States as punishment increased and rose in Britain as punishment decreased. As James Q. Wilson has observed, "coincident with rising prison population there began in 1979-80 a steep reduction in the crime rate as reported by the victimization surveys." - Weekly Standard

OK, the study mentioned is a bit old, so here is a comparison of the percent change in crime between 1997 and 2001. (Appears to be the most recent study, released in 2003.)

Homicide:
- Finland +12%
- US -12%

Violent Crime:
- Finland +7%
- US -12%

Robbery:
- Finland +7%
- US -15%

Domestic Burglary:
- Finland -24%
- US -14%

Car Theft:
- Finland +3%
- US -9%

Drug Trafficking:
- Finland +79%
- US 0

While the US has a higher absolute crime rate, the trend for the US is a decline in crime. That can't be said for Finland.

Take this from the 'murder' entry in Wikipedia:

Finland is the most violent nation in Western Europe according to several recent studies. The most likely way to get "manslaughtered" in Finland is to get stabbed or severely beaten by an intoxicated male person. Also, guns such as rifles and shotguns have traditionally been more usual in Finland than in most of Europe due to the popularity of hunting. There are over a million registered guns and firearms in private ownership in Finland while the country's entire population is only a little over five million. - Wiki

So Finland shouldn't brag about their low crime rate, unless they are bragging to Americans. Keep in mind that being drunk is an acceptable excuse in Finland as to why a person is not guilty of murder.

Finland is not the only country with this problem. I have a good friend from Estonia. She had mentioned that Estonians go to Sweden to commit crimes because even if they get caught, Swedish jails are not that bad.

What is the right way to treat a triple-murderer like Juha Valjakkala? I would think that this would be a person worthy of the death penalty. The Finns think otherwise. And that is why he is now out loose wandering the Finnish, or even perhaps the Swedish countryside.

You can bet that Juha has no problems with the Finnish system. Neither do two other Finns who have committed murder in the US and then fled to Finland, to avoid the death penalty.

Finnish triple murderer escapes from minimum security prison - Helsingin Sanomat
Crime Without Punishment - Weekly Standard
International comparisons of criminal justice statistics 2001 - PDF
Finnish Murderers - Wiki


Update: 1 December 2006

Finnish police have recaptured escaped* triple murderer Juha Valjakkala.

Police arrested escaped triple murderer Juha Valjakkala at his private home in the Maunula district of Helsinki at 7:30 Thursday evening. Valjakkala, who had escaped from the Hamina Work Colony run by the Finnish Prison Service in the south coast city of Hamina on Monday night, did not put up any resistance when he was arrested. - Helsingin Sanomat

Great they have caught him, but this follow-up story makes this whole case even stranger. For starters, what is a person who has been in jail for the last 18 years, serving a life sentence, doing with an apartment? How is he paying the bills for the apartment? Is the Government paying the bills? Why didn't he have the place rented out? Are there some protections in place because it would be unfair if he lost his home while in prison?

Just how did he get to Helsinki? Why he stole a car of course:

Jalonen thinks that it is likely that Valjakkala drove to Helsinki in a car that was stolen from Hamina at about the time that he fled the city. The car was found in Maunula the following day. However, Jalonen emphasised that the investigation is not yet complete. - Helsingin Sanomat

Good thing the car owner did not confront him. After all, this guy killed three people over a bicycle. A bicycle. Is he in jail for theft of a bicycle? No, for murder. That was how far this guy was willing to go as a criminal. Killing for no real reason. It's not like he was robbing a bank or other hi-stakes crime.

Minister of Justice Leena Luhtanen (SDP) said on Thursday that transferring Juha Valjakkala from an ordinary prison to a more open labour colony was a mistake.

Speaking in Parliament during Question Time, Luhtanen noted that the decision was made by the Criminal Sanctions Agency, and that the Ministry of Justice had no knowledge of the matter.

MP Petri Salo (Nat. Coalition Party) asked how it was possible that a triple murderer with a record of four escapes could be moved to a labour colony where supervision of inmates is more difficult, and escape is easier. - Helsingin Sanomat

Too bad there will not be a serious questioning of this case. He will be put into a real prison for a while, but not for very long. After all, he was recommended to be pardoned and released. (Keep in mind that according to the law, he did not escape despite the title of the article.)

Inspector Jukka Siltaloppi of the Criminal Sanctions Agency says that Valjakkala will be placed immediately in a closed prison.

Siltaloppi believes that Valjakkala will not have any hope of getting a furlough or being transferred to a minimum security prison for at least six months to a year.

He also faces disciplinary action, which could vary from a warning to solitary confinement. - Helsingin Sanomat

Wow. No vacations for at least six months and it will be at least a half year before he can escape again from the Hamina facility. The police also managed to interrupt a meeting he was having with a woman:

In addition to Valjakkala there was a woman about 40 years old in the apartment. The National Bureau of Investigation is looking into her possible involvement in the events, but police say that she is being treated as an outsider.

"She has certainly had some kind of relationship with Valjakkala, but we have not yet investigated the matter", said Police Inspector Kari Jalonen. - Helsingin Sanomat

Treated as an outsider? What the hell is that. She was found in the apartment with the most-wanted man in Finland. She was either a hostage or she was an accomplice. Looking at this Finnish article here where they interview the woman, it seems she was more of a girlfriend although she claims in the article that there is no love there, even though she met him in prison and continued to write and that the apartment was hers and that he just took his vacations there. Yeah right. (Feel free to add a better translation in the comments if I misunderstood.) Anyway, they did not take her in for questioning, which is how the news reporter got her hands on her.

Clearly, this is not the end of the story. He is not dead yet.

The Finns are lucky that their murder rate is low. I can't see how they could manage with too many more murderers to deal with. They won't have to deal with this one for much longer as he is overdue for release. Yes, I know that he is in for life, but in Finnish terms that's about 12 years. As it stands now, he has been in prison longer than anyone else in Finland.

Update: 2 December 2006

Juha Valjakkala tried to hang himself in prison. Unfortunately, he did not succeed so they will still have to deal with him once he gets out of prison. Interesting in that he proved so efficient in being able to kill others yet failed when attempting to kill himself. Maybe he is no longer a danger to society.

Kolmoismurhaaja Juha Valjakkala yritti perjantaina itsemurhaa. Ilta-Sanomien mukaan Valjakkala yritti hirttäytyä vankisellissään Helsingin vankilassa eli Sörkässä. - Helsingin Sanomat

Surely this story is nowhere finished.

Update: 4 December

Here is the summary of the hanging attempt in English:

Juha Valjakkala, who was sentenced to life imprisonment for killing three members of the same family in northern Sweden in 1988, tried to hang himself after being re-arrested on Thursday. Valjakkala escaped from a low security prison at Hamina in Finland on Monday but was seized three days later at an apartment in Helsinki.

Now he is being detained under police guard in a psychiatric ward in the Finnish capital, according to Aftonbladet and the Finnish paper Ilta Sanomat. Two hours after Valjakkala was arrested on Thursday he was found in his cell "in a bad condition". He was taken to the emergency ward of Helsinki's Maria hospital.However, his injuries were not judged to be serious and Valjakkala was taken to a secure psychiatric ward. - The Local, Sweden

How is it possible that he could have managed to try and kill himself within two hours of being recaptured? Wasn't he interrogated? How often do guards go around checking inmates? Are Finnish criminals that different that they can be relied upon to behave on their own?

There are some other things that bother me. How is it that he was permitted to change his name? Really. Just think about that. In a country of about 5 million people, they kind of know who their infamous criminals are (I am told) so it is completely idiotic to permit an infamous criminal to change his name and give him a new identity. Poor him if he is stuck with a name that everyone recognizes, for the wrong reasons.

Also, when are European countries going to stop transferring prisoners back to their home country to serve their sentences? I can understand that it makes it easier for the relative to visit prisoners, but shouldn't the prisoners take that into consideration prior to doing the crime? At least in the case of murder, I would think that the country where the crime took place might have more of an interest in ensuring that the prisoner is kept locked up. If they are willing to commit crimes in other countries they should be ready to face justice on those other countries, including the death penalty, like in the US.

*"Leaving an open institution is not considered as an escape." Finnish Prison Service

Police catch escaped triple murderer Juha Valjakkala in Helsinki - Helsingin Sanomat
Naistuttava:
Järjestin Valjakkalalle pakopaikan - Iltalehti

US Airways Imams Should Be Prosecuted

This is not how Religious member of society are supposed to behave. This is how terrorists and terror enablers act.

At the very least, these Imams should be banned from flying. However, they really should be prosecuted and sent to jail.

Muslim religious leaders removed from a Minneapolis flight last week exhibited behavior associated with a security probe by terrorists and were not merely engaged in prayers, according to witnesses, police reports and aviation security officials.

Witnesses said three of the imams were praying loudly in the concourse and repeatedly shouted "Allah" when passengers were called for boarding US Airways Flight 300 to Phoenix.

"I was suspicious by the way they were praying very loud," the gate agent told the Minneapolis Police Department.

Passengers and flight attendants told law-enforcement officials the imams switched from their assigned seats to a pattern associated with the September 11 terrorist attacks and also found in probes of U.S. security since the attacks -- two in the front row first-class, two in the middle of the plane on the exit aisle and two in the rear of the cabin.

"That would alarm me," said a federal air marshal who asked to remain anonymous. "They now control all of the entry and exit routes to the plane." - Washington Times

You can bet that the Imams knew what they were doing when they choose those seat locations. If they wanted to sit in different parts of the plane, why not check in and request to sit like that.

According to witnesses, police reports and aviation security officials, the imams displayed other suspicious behavior.

Three of the men asked for seat-belt extenders, although two flight attendants told police the men were not oversized. One flight attendant told police she "found this unsettling, as crew knew about the six [passengers] on board and where they were sitting." Rather than attach the extensions, the men placed the straps and buckles on the cabin floor, the flight attendant said. - Washington Times

Now they have weapons. It was not clear to me at first why they had asked for them as the news did not point out that they were given the seat-belt extenders and that they failed to put them on, instead putting them on the floor, ready to grab for assaulting the flight crew. Instead of presenting the facts of the incident, the mainstream media left open the possibility that whether they were needed was a matter of opinion and that the flight attendants were being cruel, forcing the imams to be strapped tightly into the seats. Shame on the media for distorting the story.

The imams who claimed two first-class seats said their tickets were upgraded. The gate agent told police that when the imams asked to be upgraded, they were told no such seats were available. Nevertheless, the two men were seated in first class when removed.

A flight attendant said one of the men made two trips to the rear of the plane to talk to the imam during boarding, and again when the flight was delayed because of their behavior. Aviation officials, including air marshals and pilots, said these actions alone would not warrant a second look, but the combination is suspicious.

"That's like shouting 'fire' in a crowded theater. You just can't do that anymore," said Robert MacLean, a former air marshal. - Washington Times

Why did only two of them move into first class? They must have been very insistent as anyone who flies knows that you can't just sneak into first class.

And what were Imams doing in first class anyway? Is that the way that muslim imams travel? If so, why did they not just buy first class tickets from the start?

So why were these muslims targeted? Was it for their outrageous behavior or was it for their being muslims? Do you think their might have been other muslims on that flight? Why were they not removed?

The pilot said the airlines are not "secretly prejudiced against any nationality, religion or culture," and that the only target of profiling is passenger behavior.

"There are certain behaviors that raise the bar, and not sitting in your assigned seat raises the bar substantially," the pilot said. "Especially since we know that this behavior has been evident in suspicious probes in the past."

"Someone at US Airways made a notably good decision," said a second pilot, who also does not work for US Airways.

A spokeswoman for US Airways declined to discuss the incident. Aviation security officials said thousands of Muslims fly every day and conduct prayers in airports in a quiet and private manner without creating incidents. - Washington Times

Clearly the profiling of behavior worked. The actions of these Imams does nothing but support terrorism, both in pushing transportation employees not to question suspicious behavior as well as informing terrorists what kind of actions are possible to get away with on an airplane. THAT, is what professionals call a 'DRY RUN.'

And No, you can't say allah akbar anywhere near a plane. I would take that as evidence enough that you are getting ready to kill everyone around you and would expect law enforcement to put you down before you got the chance to meet allah on your own terms.

Will any muslims speak out against the behavior of these Imams? Most likely not. Take a look here at what happened to a US muslim who spoke out against jihad and Islamic Terrorism.

Update: 6 December 06

Thanks to Sout al Kouffar for this video response aptly titled 'Flight Club.'

Now all we need is for US Airways to announce that they are suing the six imams for the expenses they incurred as a result of their stunt.

Update: 17 December 06
Newt Gingrich also believes that these imams should be prosecuted:

Former House Speaker Newt Gingrich told an audience in New Hampshire Muslim clerics pulled off a plane for praying should have been charged criminally.

Gingrich made the remark Friday night, as he delivered the keynote speech at the Manchester Republican City Committee Christmas dinner, the Manchester (N.H.) Union Leader reported.

"Those six people should have been arrested and prosecuted for pretending to be terrorists," Gingrich said. "And the crew of the U.S. airplane should have been invited to the White House and congratulated for being correct in the protection of citizens." - Washington Times

Exactly.

How the imams terrorized an airliner - Washington Times
Flight Club at YouTube
ISLAM WAS NOT HIJACKED - FFI
Signs that Allah (God) is not on Your Side - FFI

Maritime Monday 35

Welcome to this weeks edition of Maritime Monday.

This Week's Photos:
Here is an example of some out of the box thinking. A sea-based rocket launching platform. It takes less energy to launch a satellite into space at the Equator because you can take the most advantage of the Earth's rotation. As you can see from the map below, there are some countries where it could be possible to launch from the equator, but why limit yourself to those choices, when you can just build your own spaceport at sea and control all the factors without having to deal with a possible questionable Government. (The vessels are home-ported in Long Beach.)

(SEA LAUNCH COMMANDER and the ODYSSEY at the Equator)

(Diagram of the converted oil platform turn ODYSSEY launch platform)

(Launch site at left)

(Launch of XM Radio's 'XM-4' communications satellite on October 30, 2006)

More photos and a summary of this launch mission here at the Sea Launch Mission page.

More at the Sea Launch Homepage.


This Week's Items:
Eagle Speak covers the concerns of the anti-nuke crowd over the shipment of nuclear fuel by the ATLANTIC OSPREY which happens to be a single-hull vessel.

Sustainable Shipping has the must-read assessment that double-hull tankers ARE NOT less likely to have oil spills, and in some cases are even more likely. Ever hear of a mid-deck tanker? It is a design where the cargo tanks are separated top and bottom with a bulkhead. This way, if the bottom is holed, the pressure of the water pushing up is greater than the pressure of the oil pushing down through the hole, resulting in very little leaked oil. More here.

BBC News has the story of the capture of a homemade submarine captured off of Costa Rica carrying three tons of cocaine. Marine Log has more details on the homemade craft captured off Costa Rica and how the submarine was not a submarine at all.

The Star, Canada covers the still-unfolding story of two solo "around the world" sailors who are in serious trouble in the southern ocean. Surely, not the last either before the face is over. (As a professional sailor, I consider this race the ultimate act of irresponsibility for a sailor.)

Forbes.com has the news of the Ontario Teachers Pension Plan (in Canada for those not familiar) agreeing to purchase Cargo Terminals in New York and in Canada. No comment so far from Senator Schumer on yet another foreign group purchasing port infrastructure. (The self-proclaimed libertarian-socialist-communist author of the LE REVUE GAUCHE Blog expects the right to start frothing at the mouth over the news of Canadian teachers purchasing port facilities in New York. The author, Eugene Plawiuk, claims to be an 'investigative researcher'. So I wonder how he overlooked the simple fact that it was Democrats who first went ballistic over the foreign purchase of US port facilities.)

Yahoo news carried the story that "The perception that there is a long list of unimplemented 9/11 recommendations [concerning port security] is simply not accurate." As the story explains, don't expect the Democrats to do much (anything) to improve port Security.

Sailors, Mariners & Warriors League has coverage of the collision of surfacing Japanese sub ASASHIO with the Panama Flag cargo ship SPRING AUSTER.

The Salt Lake Tribune has this week's other must-read by MARCEL RODRIGUEZ, Lt. USNR (Ret.) who writes about serving in the merchant marine during WWII.

PortWorld has the comment by Ton Dufresne, President of the Canadian International Longshore and Warehouse Union, who said that the proposal to have background checks on port workers' criminal records was based on an "urban myth" that there was organized crime within the ILWU.

The ILWU has a press release explaining that background checks of their workers in the US is not needed as there are no terrorists in their ranks. (What about criminals?)

The LA Times has the news of over 800,000 TEUs moving through the Port of Los Angeles in October, a record. No other US port has even managed to hit the 700 thousand mark, other than the Port of LA. (The story refers to 800 thousand containers, but later does clarify 'to the equivalent of 800,064 20-foot containers.' One 40 Footer equals 2 Twenties. So if every container handled was a 40 footer, that would be 400,000 actual containers handled.)

Kathimerini.com has the story of the Greek Coast Guard firing on a sailboat carrying illegal immigrants. (Come on, please tell me that the Greek Coast Guard can manage to stop a sailboat without having to shoot it to pieces. Or is the the new policy after they were caught dumping illegals in the waters off Turkey, to drown.)

Cargo Law has finally obtained a full set of photos of the amazing 2002 grounding of the M/V ALVA STAR.

The Nor'wester notes Canada's discrimination against Canadian fishermen as foreign fishermen are not prosecuted for violating Canada's fishing laws.

Navy Newsstand has the story of the USS JUNEAU making a port call at the Maxie Naval Base in Zhanjiang, China.

Greenpeace is pissed off at Iceland for 'harpooning' a moratorium on high-seas bottom trawling, accussing it of acting instead to protect it's own interests. (As if any country would do that.)

Lloyds Agency has a summary of the salvage operation of the ROKIA DELMAS that is aground off France. Latest entry is from 9 November noting that it will take several weeks to remove containers from the vessel.

Venezuela Analysis covers CITGO's first delivery this season of home heating oil at a 40% discount for low income families in New York City. While I will not be filling up at a CITGO anytime soon, I highly encourage anyone eligible to take advantage of the offer of below-cost fuel. This way you can finally 'stick-it' to the oil man.

Haight's Maritime Items has:

Sailor jumps from sinking boat to barge - In a story too strange to have been invented, the US Coast Guard issued a press release stating that a man was found on a barge under tow in the Atlantic Ocean off the coast of northern Florida. It appears that the man jumped from his sailboat to the barge after the two vessels collided at night. The sailboat sank. The crew of the tug was unaware of the collision. When they first noticed the man on the barge the next morning, they thought he was a stowaway and called the Coast Guard. Agents from the Coast Guard and the Customs and Border Patrol initially handcuffed the man, until they verified his identity and situation. (11/18/06). Holland + Knight

Fairplay Daily News has:

P&O Cruises re-flags more ships - LONDON - 22 November – P&O Cruises, the Carnival Corp subsidiary, is to transfer its 69,153-gt Oriana from the British to the Bermuda flag because weddings on board a British-registered cruise ship are not legally recognised. As the cruise liner will still fly the Red Ensign but under Bermuda registry, no UK seafarers will lose their jobs or any loss of conditions and pay. P&O has already re-flagged the Arcadia, Oceana and Artemis, all operating cruises out of Southampton, understandably for the same reason. The 115,000-gt newbuilding Ventura, despite the focus on its British pedigree, will also fly the Bermuda flag. This means a loss of 390,000gt from the British register. Andrew Linington of seafarer union Nautilus UK told Fairplay: “we have talked to the UK government but with no success.” Nautilus representatives were meeting P&O today over this issue. A P&O spokesman confirmed to Fairplay that the wedding issue was the only reason for transferring the ships. All five P&O ships will offer a Weddings at Sea package. A Department for Transport spokesman said the issue had been considered but the complexities of four different wedding processes made it too difficult. - Fairplay

Submissions for future editions:
Please submit articles for inclusion in next week' edition using the following submit form at Blog Carnival. You are also welcome to email photos for inclusion in future editions.

Sponsorship:
Send me an email (address in the sidebar) if you would like to sponsor an edition of Maritime Monday. I accept money and gear.

Previous Editions:
Here.

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Being Less Poor: Playstation 3 Flatscreen Christmas Edition

It is Christmas time again and once again we have a perfect example of why many people in the US are poor. Because they are blowing money on things like the Playstation 3 video game system by Sony. That sucker sells for over $600 and it does not even include any games with it. Sure, if you can afford the thing, then that is your problem where to cram it in with the other stuff around the TV. However, there is all this talk of 'the poor' in America. I can only guess at how many poor were lined up waiting to get their hands on one of these things.

Now, I am not talking about the poor who were paid to wait in line by some moneybags who has better things to do than stand outside a store for days for something he can order online a couple months from now once the insanity wears off. Nor an I talking about those who purchased one to resell on Ebay. I am talking about almost everyone else who is getting ready to waste $600+ for a game while at the same time complaining that they never have any money. That's basically almost everyone that was waiting in line. No wonder you guys are poor. Not only were you waiting to purchase an overpriced product, but you were also not working to do it. Did you call in sick, or perhaps took a vacation day or two. Maybe you are unemployed and see the game as something that you deserve. No matter the situation, most of the people who purchased this thing probably deserve to be poor, just for the stupidity of the purchase.

Now there is some good to be found in all of this. First, if you were able to find the $600, then you can surely find another $250. And if you were prepared to buy one but were not quick enough to get one, then you have $600 that you can use to make yourself richer. That is by making a direct investment in stock.

Many stocks permit you to make a direct purchase through their websites. Stocks such as General Electric and Exxon Mobil among many others. Many (but not all) pay a dividend every three months. This can be given as either cash or as more stock. The price to open an account it not so great. The fee for the two I listed above is only $250. So for the price of a Playstation 3 you could instead open an account for both GE and XOM and still have $100 left over to purchase one $50 monthly investment for each afterwards. That's right, once the account is open, you can purchase additional stock for as little as $50. That amount should be easy to find, since by not buying a Playstation 3, you won't be buying games for it, or Blu-Ray DVDs. See, you'll be saving a ton in no time.

So which stocks to buy. I have listed two above that I own, but they may not be the right ones for you or the reasons that I purchased them might not be relevant for you. One way that you can narrow down the possible list is to limit your choices to those stocks that issue a dividend. They tend to be more stable and should be making a profit, which is where the dividend comes from. If you want my opinion about a stock, ask in the comments, even anonymously if you wish.

Now, just imagine what you could do by not spending a couple thousand on a flat screen TV! (and then the additional cable fees to get a high definition TV signal and hundreds more for a HD DVD player and disks.)

As always, keep in mind that there are two reasons why people are poor:

- They do not earn enough money
- They spend too much money

People dwell too much on reason one and tend to ignore reason two.

Keep in mind that direct investment makes a great Christmas present and allows you to purchase additional stock each Christmas, birthday or other celebration.

Of course you could also use the $600 to pay off part of your credit card debt......

Read more in the Past Issues:

Being Less Poor - 27 October 2005
Being Less Poor: Update - 18 June 2006

BE SMART

Europes Newest, Crushing 'Feel-Good' Taxes

Global warming is all the rage in Europe. When they are not busy blaming the US, they are thinking of ways to fight it themselves. Well, not really fight it. More so to punish the average person, by forcing them to pay the 'actual cost' of their actions, including their share of the environmental damage that their actions create. This is mainly done through taxes. For the longest time, gasoline in Europe has been heavily taxed, to the point of 60% and more of the total price, resulting in gas being twice as expensive in Europe as it is in the US. Of course, there are other ways to travel and other ways to damage the environment.

Take this new tax proposal that is being debated in the UK:

CONSUMERS could be hit by steep price rises for a range of goods from food to hotel breaks under plans to tackle climate change being considered by David Miliband.

The Environment Secretary is consulting taking sweeping powers to extend curbs on greenhouse gas emissions so that they cover many more businesses, including supermarkets and hotel chains — curbs that at present apply only to the big industrial users. The costs incurred are potentially huge and are likely to be passed on to the consumer. - Times Online

This is a different tax than this next one that the Times Online reported on in July of this year:

AIR passengers will be charged up to £40 extra for a return ticket within Europe to pay for the environmental impact of their journeys, under plans approved by the European Parliament yesterday.

MEPs voted in favour of the “immediate introduction” of a tax on jet fuel for flights within the 25 member states of the EU. The charge would double the cost of millions of budget airline flights. - Times Online - July

Looks like flying around Europe is going to get much more expensive. Not that its cheap now with all the taxes that are already levied on airfare tickets. The tax on jet fuel above would be in addition to this proposed requirement for airlines to purchase permits for their CO2 emissions:

Brussels aims to include the rest of the world in the European Union's latest green policy plan set to impose CO2 emission controls on all flights within and entering Europe, according to a leaked draft proposal from the European Commission.

The plan, which will require all flights arriving or departing from EU airports to buy permits to cover their carbon dioxide emissions, will be presented just before Christmas and is crucial to the bloc's fight against global warning and climate change.

The report estimates that passengers on flights within Europe would pay an extra €9 for a ticket, with the actual sum depending on the price of the permits. Those flying long haul would pay up to €39.60, according to The Times. - Business Weekly

This plan will not permit airlines to purchase unused CO2 permits from other industries, because they are not expensive enough, and because Eastern Europe and Russia have many unused credits since Soviet industry was particularly dirty and of course, Kyoto measured pollution from 1990, when Soviet factories were still spewing pollution like there was no tomorrow. No, there will be a limited amount of credits available for purchase, with the industry as a whole, capped at how much CO2 it can emit. (Taken from the July story.)

Keep in mind that the amount of the taxes appear to be set arbitrarily with no link to the cost of the actual 'damage' created by their actions. Notice that there is no mention what this tax revenue is going to be used for.

Europe has been so concerned about global warming that they were eager to sign up for the Kyoto Accord to cut Greenhouse gases. Never mind that most of these countries have utterly failed to meet the requirements that they have agreed to, they are now getting ready to punish those countries that have refused to sign up to Kyoto.

FRANCE has threatened to tax imports from countries that have not signed the Kyoto Protocol on greenhouse gas emissions.

Its Prime Minister, Dominique de Villepin, told a meeting on sustainable development yesterday: "Europe has to use all its weight to stand up to this sort of environmental dumping.

"I would like us to study now with our European partners the principle of a carbon tax on the import of industrial products from countries which refuse to commit themselves to the Kyoto Protocol after 2012." - Sydney Morning Herald

One of the countries that this tax is aimed at is Australia. They are understandably upset. Take this comment from the Australian Sunday Telegraph:

THE country that spent 30 years testing its nuclear weapons in our region wants to punish Australia for not signing off on a voluntary greenhouse agreement.

France has outraged everyone from the Prime Minister to industry bodies for suggesting European taxes should be introduced on imports from countries that have not ratified the Kyoto Protocol, including Australia. - Sunday Telegraph

It was accompanied with this graphic:

Not that the French are ones to care about criticism. But wait, the EU is not the only ones planning to tax the rest of us for their own feel-good 'pet projects'.

There is a UN airfare tax that is attempting to take even more from your pockets:

GENEVA, Oct 9 (Reuters) - Countries around the globe are rallying to the idea of taxing air travel to fund provision of cheaper drugs to poor countries fighting AIDS, malaria and tuberculosis, France's foreign minister said on Monday.

But Philippe Douste-Blazy said it was essential for many more to come on board to ensure the success of the drug purchase programme through a new U.N.-backed project, UNITAID.

"Other countries are going to join us. We are already seeing that a genuine globalisation of solidarity is under way," he told the first session of the governing board of UNITAID, launched in New York last month by five nations.

"But there must and can be many more of us," he told a news conference later.

The five launch nations were France, which is to contribute some $250 million next year, Brazil, Britain, Norway and Chile. United Nations Secretary-General Kofi Annan and former U.S. President Bill Clinton joined them in the September launch. Nineteen rich and poorer countries have already agreed to levy the tax -- applied since July in France, whose President Jacques Chirac first proposed it -- and others say they will raise funds for the new body in other ways.

The tax is also already enforced in Brazil, Chile and Gabon, with several others to follow by early next year, but it has been fiercely opposed by airlines which say it hits them unfairly and will reduce tourism to developing countries.

But Douste-Blazy, who was elected as president of UNITAID on Monday, dismissed this argument at the news conference, saying the tiny levy involved was unlikely to deter anyone.

In France, the tax amounts to one euro ($1.26) a ticket on a domestic or European economy class flight and four euros on a business or first class seat. These figures are multiplied by four for transcontinental journeys.

In all, 44 countries have joined the pilot group that set up UNITAID, which will operate out of the U.N.'s World Health Organisation (WHO) in Geneva and aims through bulk ordering to buy vital medicines at low cost.

Its declared aim is to bring about a reduction in the price of medications and to encourage drug companies to develop new treatments by ensuring competition among them for its custom.

Some 90 percent of new cases of AIDS -- which kills 3 million people a year including 570,000 children -- are in developing countries where few can afford the drugs. Malaria kills between 1 and 3 million people a year, mainly in Africa. - Reuters

So what if the tax is only 1 Euro (5 Euros for trans-Atlantic flights.) They are still taking it from you instead of asking. The UN has been wanting to directly tax citizens for a while now and it seems they are using this route to do it. It might only be one Euro now, but as we all know taxes normally only go up. How long until some UN bureaucrat has a presentation or 'White Paper' on all the good that they can do if the tax is raised to only 2 Euros. Eventually all these taxes do add up.

Anyway, nobody asked me if I want to donate to help fund cheap drugs in the third world. Probably because my answer would be no, not one penny. It is not that I am a heartless bastard, so what if I am, but because it is not my responsibility to ensure that the third world receives cheap medicine. It is the responsibility of their own governments to look after them. Many do not because their leaders are corrupt and pocket the money that should be used to take care of their citizens. So now we have the UN come in and PAY BRIBES to these very same corrupt leaders so that they can be permitted to treat these people. This in effect perpetuates corrupt governments. And they want to use money taken from me in taxes to do it with. No thank you. How about forcing these leaders to act like they should?

Anyway, this is just a taste of what is coming in the near future. It is a shame and I believe very short sighted. Europe could actually reduce their own greenhouse gas emissions by lowering taxes. As it is now, Alcohol is being shifted all around Europe to low tax jurisdictions so that citizens from high tax jurisdictions, like Finland, the UK, and Norway, can travel and purchase cheap alcohol and return it back to their home. Many Finns travel to Sweden solely to purchase alcohol while on the ship. Many never even leave the vessel when it's in Stockholm. They also travel to Germany, taking the van or trailer with them to stock up with cases of booze. Yes, it's that bad, and it is contributing to global warming. What a waste.

Alcohol is not the only item moved around Europe creating greenhouse gases. The European Parliament itself moves between Brussels and Strasbourg every month:

Moving various files and equipment between the two cities takes 10 large trucks and the costs for two locations are estimated at € 200 million a year. A force of 30 men loads the trucks for the 400 km journey between the two locations. Around 5,000 people attached to the European Parliament, such as parliamentarians, advisors, clerks and journalists, also move between Brussels and Strasbourg. - Wikipedia

Face it, none of these taxes is really being proposed to fight greenhouse gases or even to help the poor in the third-world. They are just being imposed to take more money from you for the purpose of sustaining big government.

Update: 9 December 2006

Take the Tobin Tax. This is a proposed tax that in effect would limit the possibility of currency traders speculating in the currency markets.

The Tobin tax is an almost deceptively simple idea: a tax levied on every currency change, set on a low enough level not be a hindrance on any transactions needed to finance real trade in goods and services or long-term capital investment but high enough to discourage the bulk of destabilising speculative money movements. Given the vast amount of daily currency transactions - almost 1500 billion dollars - a tax of just 0.1 percent could generate more income than the total amount of official development aid from the industrialised to the less-developed countries. The introduction of a Currency Transaction Tax could, at a stroke, solve all the problems of development financing. - Erkki Tuomioja Blog

Of course the tax would be applied to every transaction, not just large ones. After all, you can't rake in the big bucks unless you take a slice of the pie out of every transactions. It's kind of like those scams where they only plan to steal the part that would have been rounded away. (Office Space, Superman, etc.) Then again, numbers are sometimes are rounded up. The fact that you round both up and down makes it neutral to the person who is effected by the rounding. Sometimes you win, and sometimes not. In the case of the Tobin tax both the sending and the recipient are penalized. the sending by raising his cost to send the funds. The recipient in that his product has now become more expensive.

Tobin tax - Wikipedia
Zero Tuomioja and the Tobin Tax - Finland for Thought

Air fares 'to double' as Europe votes for green tax - Times Online - 5 July 06
Green tax on holidays and food splits Labour - Times Online
Nations rally to air travel "medicines" tax- France - Reuters
Airlines Hit By EU's CO2 Emissions Plan - Business Weekly
French promise revenge for not signing protocol - Sydney Morning Herald
Hopping Mad Over French Sneer - Sunday Telegraph